The cytokine erythropoietin (Epo) initiates proliferation and differentiation along the red blood cell lineage. The Epo gene is physiologically regulated by hypoxia, through a defined element in the Epo gene 3' enhancer. Epo expression additionally requires factors which bind to a small direct repeat sequence known as a DR2 element, which is adjacent to the hypoxia responsive site. DR2 elements serve as binding sites for members of the nuclear receptor family, which includes HNF4 and retinoic acid (RA) receptors. While HNF4 has previously been implicated as a regulator of Epo expression through the DR2 sequence, there has been no prior indication that the Epo gene is RA responsive. New evidence derived from analysis of knockout mice and through molecular and biochemical approaches suggests that retinoic acid is in fact a regulator of Epo gene expression in the fetal liver, and thereby regulates definitive erythropoiesis. Hypothesis and model: In early definitive hematopoiesis, erythropoietic differentiation is regulated by retinoic acid and the retinoic acid receptor RXRalpha by direct transcriptional activation of Epo gene expression through the Epo enhancer DR2. In later erythropoiesis, there is a transition to regulation by HNF4. Specific Aim 1: Demonstrate that Epo gene expression is directly regulated by retinoic acid and by RXRalpha. Extensive preliminary data presented in this proposal indicate that the Epo gene is a downstream target gene of retinoic acid action. In this Aim, I will confirm that the Epo gene is directly activated by retinoic acid, and that the nature of this regulation occurs through recognition by RA receptors of the Epo enhancer DR2 element. Specific Aim 2: Define the molecular basis of the onset of erythropoiesis in RXRalpha-/- embryos. In this Aim, I will test the hypothesis that a transition occurs in definitive erythropoiesis from regulation of Epo gene expression retinoic acid and RXRalpha to regulation by HNF4.